Quarterly price notifications - Key concepts

largeimage

Picture: Products subject to the price notification procedure under the generic substitution and reference price systems (pdf)

Authorised agent = A third party authorised by a pharmaceutical company to submit quarterly notifications to Kela on its behalf.

Available on the market = A medicinal product is available on the market once a notification of introduction to market has been made about it to Fimea. Only products which are available on the market and which the pharmaceutical company declares to be generally available, are taken into account when defining price bands and reference prices.

Generally available = Status indicated in the quarterly notification of interchangeable medicinal products. The pharmaceutical company declares whether a specific product is generally available at the time of notification and in the following quarter. Only products for which a notification of introduction to market has been made to Fimea and which the pharmaceutical company declares to be generally available are taken into account when price bands and reference prices are defined.

Kela's medicinal products database = An online search portal containing up-to-date information about medicines, clinical nutrients and emollients available on the Finnish market, about their reimbursement status, and about interchangeable medicinal products. The service is based on data from the Pharmaceutical Database.

Lowest price in the price band = The lowest retail price (incl. VAT) of a group of interchangeable medicine packages at the beginning of a quarter. If the medicine packages constitute a reference price group: the lowest retail price of reimbursable packages (incl. VAT) at the beginning of the quarter. The lowest price is defined on the basis of quarterly notifications submitted by pharmaceutical companies to Kela. It can be defined only on the basis of medicine packages for which a notification of introduction to market has been submitted to Fimea and which the pharmaceutical company has declared to be generally available.

Pharmaceutical Database = A database of pharmaceutical products which is updated twice a month and covers all pharmaceutical products, clinical nutrients and emollients available on the Finnish market. Medicines are prescribed and dispensed on the basis of information in the Pharmaceutical Database. Lääketietokeskus Oy has been contracted by Kela to provide technical maintenance for the Pharmaceutical Database.

Price band = The margin within which prices can fluctuate, calculated on the basis of the lowest priced product in a group of interchangeable packages of medicine. Pharmacies have an obligation to substitute a product whose price exceeds the upper limit of the price band for any product whose price is within the price band. Price bands are defined four times a year based on the prices notified by pharmaceutical companies to Kela (see quarterly notification). If a product costs more than the upper limit of the price band or is not generally available, it is not included in the price band.

Price notification service = Online service for pharmaceutical companies. A portal maintained by Kela which pharmaceutical companies can use to submit quarterly notifications. A Katso ID from the Population Register Centre is required to sign in. The service is only accessible for companies with a Finnish business ID.

Product eligible for generic substitution = A medicinal product which is included on Fimea’s list of substitutable medicinal products. Kela defines the price bands for the substitutable products four times a year. Certain substitutable and reimbursable medicinal products are also included in the reference price system.

Product included in the reference price system = A medicinal product which is included on the decicion concerning the reference price groups and reference prices published by the Pharmaceuticals Pricing Board (see decisions, in Finnish). Decision is based on price notifications submitted to Kela four times a year.

The Pharmaceuticals Pricing Board determines the reference price groups, the products included in the groups and the reference prices for each quarter of a year.

A medicinal product included on the listquarterly notification about the product must be submitted to Kela in order to avoid loss of reimbursability.

Product subject to the price notification procedure = A medicinal product which is included on the Pharmaceuticals Pricing Board’s list. A quarterly notification about the product must be submitted to Kela.

The Pharmaceuticals Pricing Board publishes two lists (in Finnish):

Product undergoing a transition period = In the event that an existing reference price group is no longer constituted, the medicinal products included in that group will undergo a transition period. A quarterly notification about such products must be submitted to Kela in order to avoid loss of reimbursability. The transition period lasts up to one year, during which time the holder of the marketing authorisation must submit an application for the renewal of reimbursability to the Pharmaceuticals Pricing Board.

Quarterly notification = Price notification made to Kela by pharmaceutical companies concerning medicinal products subject to the price notification procedure under the generic substitution and reference price system.

Reference price = Lowest retail price (incl. VAT) of reimbursable packages in the reference price group at the beginning of a quarter + €0.50. The Pharmaceuticals Pricing Board is responsible for defining the reference prices. The reference price is the highest price reimbursable at the pharmacy. Customers who decline the substitution must pay the part of the price that exceeds the reference price out of pocket.

Reference price group = A group of interchangeable medicine packages which includes at least one reimbursable generic, parallel import or parallel distribution product. The Pharmaceuticals Pricing Board defines the reference price groups four times a year. A reference price group can only be formed around a product about which a notification of introduction to market has been made to Fimea and which the pharmaceutical company has declared to be generally available. All medicinal products in a specific reference price group share the same reference price and substitution code.

Substitutable products = Products where the active substance and amount are the same and which are biologically equivalent. Fimea publishes a list of substitutable medicinal products four times a year.

Substitution group = A group of interchangeable medicinal products. Fimea draws up a list of substitutable medicinal products and assigns them into substitution groups based on active substance and strength. At the same time, each group is given a four-digit identifier.

Substitution group code / Substitution code = 10-digit code used to identify which packs of medicine are interchangeable. The codes are assigned jointly by Kela and the Pharmaceuticals Pricing Board. The same codes are used in both the generic substitution system and the reference price system.

Certain packages of tablets and capsules share the same four digits even though the pack sizes differ slightly. These include

  • the pack sizes 28, 29 and 30, which share the last four digits 0030
  • the pack sizes 49 and 50, which share the last four digits 0050
  • the pack sizes 98, 99 and 100, which share the last four digits 0100

Upper limit of the price band = Lowest retail price (incl. VAT) of a group of interchangeable medicine packages at the beginning of a quarter + €0.50. If the medicine packages constitute a reference price group: the lowest retail price of reimbursable packages at the beginning of a quarter (incl. VAT) + €0.50.

Withdrawal from the reimbursement system = Products included in the reference price system may be withdrawn from the reimbursement system by a corresponding indication in the quarterly notification. The notified wholesale price must be higher than the maximum wholesale price confirmed by the Pharmaceuticals Pricing Board.